September 29, 2008

Mayo Clinic + Huge coal company

Coal companies in the Powder River Basin (Of DM&E fame) are looking for best healthcare for workers. That means the world's top coal producer is forgoing send its workers to the local hospital for treatment and are sending them to Mayo Clinic and elsewhere.

Gillette has a hospital is partially public owned through the county. That means the doctors salaries are public information, which made us newspaper employees popular there. heh.

Anyway, here's some from the Bloomberg news story:

Ken Ferguson, 54, maintains the bulldozers and heavy trucks that haul coal at the Belle Ayr mine near Gillette, Wyoming. In return, his employer, Foundation Coal Holdings Inc., provides his family with the best medical care it can buy.

Ferguson's wife, Shanna, had her colon removed last year because of chronic inflammatory disease. Foundation sent her 700 miles away to the top-ranked Mayo Clinic in Rochester, Minnesota. The company covered the $85,000 bill for the operation and follow-up reconstructive surgery and even paid for Ken's motel.

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The coal producer says it has found an unconventional way to cut health costs: Seek out the nation's best care and give workers incentives to use it. About two-thirds of operations have proven to be cheaper at better-rated hospitals out of state. Even when the price was higher, the Linthicum Heights, Maryland-based company saved money by reducing misdiagnoses, complications and repeat procedures.

Health-care costs for an average employee at Foundation's two Wyoming mines have dropped about 5 percent a year since the program took full effect in 2005, while U.S. spending rose about 7 percent annually. As Foundation's Wyoming workforce grew, its total medical bills remained steady at about $5.5 million a year.

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Peabody Energy Corp., which is based in St. Louis and is the world's largest coal producer, has joined Foundation in offering the benefits program. The company has signed up the workers at its surface-mining operations in Wyoming's Powder River Basin.

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Robert Morasko, chief executive officer of the Campbell County Memorial Hospital in Gillette, said the facility provided excellent care to its patients at low prices.

``There's no question our prices are competitive,'' he said. ``The coal companies do use us for a lot of surgeries. There are some isolated cases where they don't.''

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The cynic in me wonders if this could be part of a back-room deal to achieve Mayo buy-in of the DM&E expansion, especially at a time Mayo is advocating high-speed passenger rail to bring in more patients. Those passenger trains would likely have to share CP/DM&E tracks for at least part of the route.